Comparing China Construction Bank (OTCMKTS:CICHF) & Citigroup (NYSE:C)

China Construction Bank (OTCMKTS:CICHF) and Citigroup (NYSE:C) are both financial services companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, earnings, valuation, profitability and dividends.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for China Construction Bank and Citigroup, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
China Construction Bank	0	0	0	0	0.00
Citigroup	0	7	11	0	2.61

Citigroup has a consensus target price of $108.70, indicating a potential upside of 4.69%. Given Citigroup’s stronger consensus rating and higher possible upside, analysts clearly believe Citigroup is more favorable than China Construction Bank.

Profitability

This table compares China Construction Bank and Citigroup’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
China Construction Bank	N/A	N/A	N/A
Citigroup	8.73%	7.91%	0.60%

Earnings & Valuation

This table compares China Construction Bank and Citigroup”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
China Construction Bank	N/A	N/A	N/A	$0.91	1.18
Citigroup	$85.43 billion	2.17	$12.68 billion	$7.12	14.58

Citigroup has higher revenue and earnings than China Construction Bank. China Construction Bank is trading at a lower price-to-earnings ratio than Citigroup, indicating that it is currently the more affordable of the two stocks.

Dividends

China Construction Bank pays an annual dividend of $0.30 per share and has a dividend yield of 28.0%. Citigroup pays an annual dividend of $2.40 per share and has a dividend yield of 2.3%. China Construction Bank pays out 33.0% of its earnings in the form of a dividend. Citigroup pays out 33.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Citigroup has increased its dividend for 2 consecutive years. China Construction Bank is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

6.7% of China Construction Bank shares are held by institutional investors. Comparatively, 71.7% of Citigroup shares are held by institutional investors. 0.1% of Citigroup shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

Citigroup beats China Construction Bank on 12 of the 14 factors compared between the two stocks.

About China Construction Bank

China Construction Bank Corporation provides various banking and related financial services to individuals and corporate customers in the People's Republic of China and internationally. It operates through Corporate Finance Business, Personal Finance Business, Treasury and Asset Management Business, and Others segments. The company accepts various deposits, such as foreign currency, all in one accounts, RMB, corporate term and notification, and corporate demand deposits, as well corporate deposits by agreement. Its loan products include personal business, car, and housing loans; and SME, traditional credit, commercial draft, buyer credit, and RMB credit line loans. The company also offers credit cards; physical gold for personal investment and personal gold accounts; foreign exchange services; certificate treasury and savings bonds, securities deposit accounts, and securities services, as well as bank-securities transfer and book-entry treasury bond over the counter transaction services; and wealth management products. In addition, it provides collection, salaries payment, third-party collection and payment, insurance agency, and remittance services; international settlement and financing, and FI services; securities and fund settlement services; guarantee-based, consulting and advising, and factoring services; fund custody services; and e-banking services. Further, the company offers institutional services comprising services for government agencies, social security, banks cooperation, bank-securities cooperation, bank-insurance cooperation, and services for non-banking financial institutions. China Construction Bank Corporation was founded in 1954 and is headquartered in Beijing, the People's Republic of China.

About Citigroup

Citigroup Inc., a diversified financial service holding company, provides various financial product and services to consumers, corporations, governments, and institutions worldwide. It operates through five segments: Services, Markets, Banking, U.S. Personal Banking, and Wealth. The Services segment includes Treasury and Trade Solutions, which provides cash management, trade, and working capital solutions to multinational corporations, financial institutions, and public sector organizations; and Securities Services, such as cross-border support for clients, local market expertise, post-trade technologies, data solutions, and various securities services solutions. The Markets segment offers sales and trading services for equities, foreign exchange, rates, spread products, and commodities to corporate, institutional, and public sector clients; and market-making services, including asset classes, risk management solutions, financing, prime brokerage, research, securities clearing, and settlement. The banking segment includes investment banking; advisory services related to mergers and acquisitions, divestitures, restructurings, and corporate defense activities; and corporate lending, which includes corporate and commercial banking. The U.S. Personal Banking segment provides co-branded cards and retail banking services. The Wealth segment provides financial services to high-net-worth clients through banking, lending, mortgages, investment, custody, and trust product offerings; and to professional industries, including law firms, consulting groups, accounting, and asset management. The company was founded in 1812 and is headquartered in New York, New York.